Government comes under fire over rates funding

The Government is proposing that town halls keep the rates that are raised locally as a way of funding public services rather than via central Government grants.

Currently business rates are pooled nationally before being distributed throughout the country on the basis of local community and public service needs.

Councillor Peter Box, chair of Local Government Yorkshire and Humber and Leader of Wakefield Council, said the policy will damage efforts to help deprived areas.

“The Government’s proposals that councils’ funding will be based on business growth, not the needs of their communities, could seriously damage our ability to deliver services that are essential to our communities and local people,” he said. “If we are forced to have our budgets reliant on the numbers of businesses paying rates in our local areas, then valuable services such as those for the elderly, the young and for vulnerable people could be put at risk.”

Coun Box said they were concerned that rich councils with the most successful businesses – such at those in London – will prosper while others will struggle.

The Yorkshire Post campaign Fair Deal for Yorkshire is calling for more balanced funding, after it emerged local government grants, transport and health allocations all appeared to favour the South.